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Akoustis $13M order & July PPI +3

11:10 15-Aug-24

The market is focused on the ever-resurgent American retail consumer today, with Walmart earnings and media providing more of a boost than the government numbers.  I think those numbers should be weighed against credit balances and delinquencies.  The market rarely pays attention, though, and I'm more interested in the minor corporate news.

Google now has a September 6th court date for the app store ruling against it, and commentary from the Judge indicates that he will reject Google's attempts to avoid meaningful change.  I will certainly update on the actual repercussions when they are available.

Lumen also announced a $4.3M 3 year deal with New Mexico to provide K-12 schools with fiber access.  This was already referenced in the earnings call, and the amount is trivial, so I didn't mention it and can see no good reason why management is doing so now.

Finally, I will document that FutureFuel has filled the board position that was resigned by its CFO.  The experience certainly seems to fit, and perhaps changes are afoot.  FF shares have more than matched post-earnings negative volatility with the positive sort of late.  Lack of coverage and the presidential prospects are probably also exacerbating this.  So, I note that options are good tools increasing returns over time, especially if one is willing to manage positions dynamically.

July CPI numbers shouldn't change anything for the market at +0.2% for both the headline and core.  Shelter continued to be the main upward driver, and I wouldn't be surprised if the government tweaks OER (owner equivalent rent) to fudge that number.  This takes us into yet another stretch of dull economic calendar until Powell's Jackson Hole speech, probably a week from Friday, walks back any reaction to Fed minutes two days beforehand.  I also mentioned Nvidia earnings in that note, which is scheduled for the following Wednesday, August 28th.  I expect both to continue soothing what was fragile market sentiment.

In keeping with that, the new is about DoJ deliberations on a Google breakup and Intel selling off its ARM stake, and the market is mostly shrugging off both.  Google has also introduced Pixel 9 phones, with AI features and foldable model.  They will be generally available on August 22nd and September 4th, respectively, with hefty price tags.  As ever, Apple is taking a slower, more cautious approach for its rollout. Consequently, I will be looking for peak AI consumer sentiment around the end this year.

As implied below, AKTS is right back down to 8 cents, and one would have needed to trade in the pre-market to realize any significant gain.

On 8/13/24 08:51, Esekla wrote:

Akoustis has received a follow-on $13M order to help an existing customer extend its WiFi 6E and ramp its WiFi 7 deliveries over the coming year.  The size of the order and it coming just over month after the prior one are both encouraging.  AKTS is up 40% to trade just above 12 cents in the initial response; the long shot I mentioned last week will have hard to beat annualized return, depending on how greedy one wants to get.

July PPI numbers are out and the +0.1% headline number is lower than some expected by a tenth and in line with others.  The core number was higher by that much, though, at +0.3%, and the detail is inverse to last month with goods up 0.6% while services declined 0.2%.   To the extent that the market pays attention at all, the noisy data is unlikely to be seen as changing anything for the Fed's September decision.  CPI on Thursday morning will get more (unwarranted IMO) attention, but I'm not expecting a surprise there either.

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